Duke: $60,000 A Year For College Is Actually A Discount

Students attend graduation ceremonies at the University of Alabama in Tuscaloosa, Ala. Two-thirds of college students now graduate with debt, owing an average amount of $24,000.

Butch DillAP

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Originally published on February 21, 2014 10:36 am

In 1984, it cost $10,000 a year to go to Duke University. Today, it's $60,000 a year. "It's staggering," says Duke freshman Max Duncan, "especially considering that's for four years."

But according to Jim Roberts, executive vice provost at Duke, that's actually a discount. "We're investing on average about $90,000 in the education of each student," he says. Roberts is not alone in making the claim. In fact, it's one most elite research institutions point to when asked about rising tuition.

But just where exactly is all that money going? Michael Schoenfeld, Duke's vice president of public affairs, says for part of that answer, you need to look up: "For the first time in probably anybody's memory, there will be two cranes hovering over the main campus quad." Duke is in the process of renovating its library and dining hall; $8,000 of the $90,000 Duke spends on each student goes into building and maintaining physical infrastructure on campus.

Another $14,000 goes to pay a share of administrative and academic support salaries, which in Duke's case includes more than $1 million in total compensation to the university president, Richard Brodhead, and more than $500,000 to the provost, Peter Lange, according to 2011 tax filings. Also, $14,000 goes to dorms, food and health services; $7,000 goes to staff salaries for deans and faculty; and miscellaneous costs take up another $5,000.

Then a big chunk, $20,000, goes to Duke students who get financial aid.

"For those paying full freight, the full sticker price, their tuition dollars are supporting students who otherwise could not afford to come to Duke," Lange says.

It benefits people like sophomore Tara Mooney. She is among the roughly 50 percent of Duke students who receive financial aid. "I call them normal people," she says. "Getting financial aid, that's what I consider normal."

Most financial aid recipients have to repay a portion of their aid, which comes in the form of loans and grants. Mooney is a special case. She's one of 500 undergraduate students (not including those on merit or athletic scholarships) who pay nothing at all.

Mooney says her mom lost her job at a public school about the same time that she was applying to college. "When we saw the aid package is when my mom and I started crying, because we knew that I could actually come here," she says. "They were going to give me enough money that it was actually possible."

But the biggest category of costs is faculty, at $21,000 per year per undergraduate student.

Jennifer West is a professor of bioengineering and materials science with a long list of publications, awards and titles. To hire West away from Rice University, money wasn't enough. She came with an entourage. "I moved a whole entire research group with me, so I had to move a lot of people and then we had to move a lot of our equipment and rebuild our lab," she says. "They actually sent architects to Rice who looked at our lab facilities there, then used that information to go back and design the facility that would work for us at Duke."

West is not alone. Duke pays what it calls "startup costs" for a lot of professors, particularly in the sciences.

And decisions about hiring faculty can drive up costs in other parts of the university. Duke considers a lot of that spending when it says $90,000 is what it costs to educate an undergraduate each year.

Charles Schwartz, a retired professor from the University of California, Berkeley, who has been studying university finances for the past 20 years, takes issue with this way of accounting. He says it's unfair to place the financial cost of professors like Jennifer West, who spend most of their time in the lab, on undergraduate students. "It's just wrong to bundle all those costs together," he says.

Lange disagrees. "If for instance you try to say ... nothing about the time the faculty member does research redounds to the benefit of the undergraduate ... then I guess you can do the accounting a completely different way," he says. "I think that's a deep misunderstanding at how, at least at a place like Duke, how the actual educational delivery happens."

Schwartz doesn't deny the value of research. It helps advance the human condition, discover new technologies, find cures for cancer and, in Jennifer West's case, build transplantable organs from a small sample of cells. But Schwartz questions how much undergraduates benefit from that.

In the end, Schwartz and Lange don't disagree on the value of what goes on at places like Berkeley and Duke. The disagreement is over the story that Duke tells its undergraduates.

So if you're a student at Duke, are you getting a massive discount on the cost of your education? Or are you subsidizing a giant educational edifice that you as an undergraduate student will barely come into contact with?

The answer sort of depends on what kind of student you are.

If you're engaged in research and capitalizing on your professors' expertise, maybe you're getting something that's worth more than what you paid. If you've got a good financial aid package, you're definitely getting a good deal. But if you're a full-paying student, who's not learning much from professors outside the classroom, it's the university that's getting the deal.